Karachi, July 24, 2025: Ahmed Chinoy, Director of the Pakistan Stock Exchange and Chairman of the Pakistan Cloth Merchants Association, has urged the State Bank of Pakistan (SBP) to reduce the policy rate to 6% in the upcoming monetary policy announcement, citing the urgent need to revive economic activity and ease pressure on the country’s productive sectors.
In a strongly worded statement issued Thursday, Chinoy said Pakistan is at a critical juncture where bold and timely monetary action is essential to support industrial growth, restore investor confidence, and promote employment.
“With inflation on a downward path and the external account showing signs of stability, the current environment presents a window of opportunity to ease monetary conditions,” he stated. “The prevailing high interest rate regime has severely choked economic activity, especially among small and medium enterprises (SMEs), exporters, and manufacturers who are finding it increasingly difficult to sustain operations.”
Chinoy argued that the policy rate must be realigned with on-ground economic realities. “A cut to 6% will provide the breathing space needed for businesses to recover from the aftershocks of COVID-19, ongoing supply chain issues, and soaring utility costs,” he noted.
He warned that prolonging the monetary tightening cycle would further suppress Pakistan’s industrial base and hinder long-term development. “The productive economy cannot remain underutilized while monetary policy remains overly restrictive,” he added.
Calling on the central bank to take “responsible and decisive action,” Chinoy emphasized that a pro-growth monetary stance was now essential to unlocking the full potential of the economy.
“A lower policy rate will not only support industrial revival but also enhance credit flow to the private sector and stimulate domestic investment. The SBP must now act in the broader interest of national growth and economic stability,” he concluded.
The Monetary Policy Committee of the SBP is expected to meet later this month to decide on the benchmark interest rate amid improving macroeconomic indicators and renewed calls from industry stakeholders for easing financial conditions.
